New Law on Taxation
New Law on Taxation
Royal Kram No. NS/RKM/0523/004, dated 16 May 2023
Where could I download an English version of this new law? (all 255 articles)
Tried google to no avail.
Thanks.
Where could I download an English version of this new law? (all 255 articles)
Tried google to no avail.
Thanks.
It's likely that a professional English translation just hasn't been completed or published yet. Most laws, sub-decrees, etc are only published in Khmer, very rarely is there an official translation, so we have to wait for a private entity to get a professional translation and for them to post it online.
Here's a good overview of the amendments and updates...
https://assets.kpmg.com/content/dam/kpm ... 202023.pdf
Here's a good overview of the amendments and updates...
https://assets.kpmg.com/content/dam/kpm ... 202023.pdf
I'm not a negative person, I encourage people all the time...it's usually to f**k off! But, whatever.
@PSD_Kiwi: thanks for the feedback and link.PSD_Kiwi wrote: ↑Sat Jul 08, 2023 6:21 pmIt's likely that a professional English translation just hasn't been completed or published yet. Most laws, sub-decrees, etc are only published in Khmer, very rarely is there an official translation, so we have to wait for a private entity to get a professional translation and for them to post it online.
Here's a good overview of the amendments and updates...
https://assets.kpmg.com/content/dam/kpm ... 202023.pdf
Actually it was the link that brought me to my question.
In particular Chapter 14: Capital Gain Tax. This could be a big chance for many (tax) residents (individuals) with local and/or overseas investments. Thinking about immovable property but also interests/stocks/bonds/(managed) funds/stock options/...
I'm aware the implementation of it (Prakas 346) has been delayed to 01/01/2024.
Since the DFDL-link seems to be down I'll post this one: https://www.aseanbriefing.com/news/camb ... x-to-2024/
I'm mainly wondering how Cambodia will tax individuals/physical persons. (all people staying more than 182days per calendar year in the Kingdom).
The 2019 Law on Financial Management already contained an important reform namely "a comprehensive regime of taxation for individuals residing in Cambodia". So not only for legal persons but also for physical persons.
I'm assuming that this reform will also be part of the new Law on Taxation.
However, AFAIK, currently Cambodia does not have a comprehensive personal income tax system that requires individuals to file and pay tax to the GDT directly.
Wondering how that will turn out...
One can try to hide behind the fact that currently there's not much data-exchange between Cambodia and the rest of the world (eg. CRS) but what will you do when your overseas bank/broker/... asks you (with the risk that the customer relationship will be terminated) for a proof that you are meeting your Cambodian tax obligations? In some/many jurisdictions overseas banks are acting as gate keepers when it comes to AML.
Any thoughts?
- raendi
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Why need system like this because company pays tax from salary?Legal Seeker wrote: ↑Sun Jul 09, 2023 5:18 pmHowever, AFAIK, currently Cambodia does not have a comprehensive personal income tax system that requires individuals to file and pay tax to the GDT directly.
Pardon my engrish, thanks you.
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- KnobJocky
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I always understood that any earnings/assets made or held outside Cambodia were not subject to any Cambodian tax. Income tax only paid for work done for registered Cambodian companies. Is this wrong?
Because a Cambodian taxpayer (individual) can have more taxable income (worldwide) than salary alone; eg. rental income, interests, capital gains, royalties, ...raendi wrote: ↑Sun Jul 09, 2023 6:18 pmWhy need system like this because company pays tax from salary?Legal Seeker wrote: ↑Sun Jul 09, 2023 5:18 pmHowever, AFAIK, currently Cambodia does not have a comprehensive personal income tax system that requires individuals to file and pay tax to the GDT directly.
As an example: I (as a Cambodian taxpayer, individual) am lending 100K USD to another individual at 10% interest p.a.
Who will withhold the tax on this income and how to declare this tax (as an individual)?
The same goes for the interest I am receiving on my overseas saving account... My overseas bank isn't witholding/declaring the tax owed to the Cambodian tax man in my place...
The 2019 Law on Financial Management expanded the scope of Article 7 (previous Law on Taxation; taxable income = net income after allowable deductions during the year, incl. capital gains, interests, rental income, royalty income, income received from financial assets or investment assets including real estate) from a legal person, which previously excluded individuals, to physical persons which means that 'taxable income' since then applies to individuals too.
But how to comply?
Gaggy Bravy wrote: ↑Sun Jul 09, 2023 7:08 pmI always understood that any earnings/assets made or held outside Cambodia were not subject to any Cambodian tax. Income tax only paid for work done for registered Cambodian companies. Is this wrong?
The former Law on Taxation stated that "resident taxpayers are subject to tax on their worldwide income while non-residents are taxed on Cambodian-sourced income only. Residents earning foreign-sourced income can receive credits for foreign taxes paid, as Cambodia unilaterally accepts foreign tax credits".
Not sure about the new Law on Taxation.
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Ok so case 1: I have a property overseas that I rent out. Every month or 2 I cash in $1-4000 from my overseas bank to Cambodian bank to pay my living expenses here. Should that be taxed?
Case 2: I'm on of these digital nomads- I work online when in Cambodia, but my company pays (after tax) to my overseas bank, which I again transfer when needed.
Case 3: I'm some sort of digital nomad making YT vids, or playing poker or a freelance writer. Or I have a trustfund. No tax is paid in my own country for this, Again my earnings get wired from overseas to Cambodia.
Would all/any be subject to tax laws?
Case 2: I'm on of these digital nomads- I work online when in Cambodia, but my company pays (after tax) to my overseas bank, which I again transfer when needed.
Case 3: I'm some sort of digital nomad making YT vids, or playing poker or a freelance writer. Or I have a trustfund. No tax is paid in my own country for this, Again my earnings get wired from overseas to Cambodia.
Would all/any be subject to tax laws?
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I am very interested in this topic. Great thread makings here.
====================
Why are the gods such vicious cunts?
Where is the god of tits and wine?
Why are the gods such vicious cunts?
Where is the god of tits and wine?
I'm interested as well.
How about capital gains on online trading platforms like degiro or interactive brokers that are not bases in Cambodia.
What are the tax brackets in Cambodia?
Currently 8.25% on USD at amk,with monthly interest withdrawal.
How about capital gains on online trading platforms like degiro or interactive brokers that are not bases in Cambodia.
What are the tax brackets in Cambodia?
That's a good solution for cash & funds brought in country.
Currently 8.25% on USD at amk,with monthly interest withdrawal.
I can't speak for the new Law on Taxation, hence the reason I'm looking for a copy of it, but according to the former law and more specifically the 2019LFM I'm assuming taxes will have to be paid in all previously mentioned examples (also by physical persons on the condition that they're staying +182days in the KoW).
However much depends of the exact definition of 'taxable income' but the 2019LFM clearly mentioned 'income received from financial assets'.
@Gaggy Bravy; it has nothing to do with transferring the funds to Cambodia; (worldwide) taxable income has to be declared regardless of whether this income will be transferred to Cambodia or not.
Unfortunately the link is down, but in one of its 2019 tax update letters regarding the 2019LFM DFDL wrote:
Compared to its predecessors in 2016, 2017 and 2018 the 2019LFM does not contain a large number
of tax updates however the few amendments it has made to Articles 5 and 7 of the Law on Taxation
(LOT) lay the foundation to what we expect to be the next significant piece of tax reform in Cambodia
– a comprehensive regime of taxation for individuals residing in Cambodia.
Article 7 of the LOT provides an explanation as to what is considered to be “taxable income” which
simply put is the net income, income after allowable deductions, of a legal person after taking into
account all of its activities during the year. The taxable income of a legal person includes:
Capital gains;
Interest;
Rental income,
Royalty income,
Income received from financial assets or investment assets including real estate.
The 2019LFM has expanded the scope of Article 7 from a legal person, which previously excluded
individuals, to now include a physical person. What this means is that “taxable income” as it is defined
above now also applies to individuals.
Article 5 of the LOT has also been amended to provide that for individuals, the applicable Tax on
Income rates shall be calculated on the aggregate (total) taxable income which individuals receive in
each calendar year.
A Sub-Decree and further regulations will be issued to provide guidelines on what
deductions/allowances will be able to be claimed by individuals when determining their taxable
income. Additional guidance will also be provided on how the Tax on Income for individuals will be
collected.
AFAIK, further sub-decrees and regulations never have been issued.
Same goes for the capital gains tax (Prakas 346 GDT, probably a flat rate of 20%), all we currently know is that it has been postponed to 01/01/2024 (2nd or 3rd time meanwhile) without knowing the exact details.
If you're asking me, initially it'll be limited to the sale of immovable properties in Cambodia, but who knows...
However much depends of the exact definition of 'taxable income' but the 2019LFM clearly mentioned 'income received from financial assets'.
@Gaggy Bravy; it has nothing to do with transferring the funds to Cambodia; (worldwide) taxable income has to be declared regardless of whether this income will be transferred to Cambodia or not.
Unfortunately the link is down, but in one of its 2019 tax update letters regarding the 2019LFM DFDL wrote:
Compared to its predecessors in 2016, 2017 and 2018 the 2019LFM does not contain a large number
of tax updates however the few amendments it has made to Articles 5 and 7 of the Law on Taxation
(LOT) lay the foundation to what we expect to be the next significant piece of tax reform in Cambodia
– a comprehensive regime of taxation for individuals residing in Cambodia.
Article 7 of the LOT provides an explanation as to what is considered to be “taxable income” which
simply put is the net income, income after allowable deductions, of a legal person after taking into
account all of its activities during the year. The taxable income of a legal person includes:
Capital gains;
Interest;
Rental income,
Royalty income,
Income received from financial assets or investment assets including real estate.
The 2019LFM has expanded the scope of Article 7 from a legal person, which previously excluded
individuals, to now include a physical person. What this means is that “taxable income” as it is defined
above now also applies to individuals.
Article 5 of the LOT has also been amended to provide that for individuals, the applicable Tax on
Income rates shall be calculated on the aggregate (total) taxable income which individuals receive in
each calendar year.
A Sub-Decree and further regulations will be issued to provide guidelines on what
deductions/allowances will be able to be claimed by individuals when determining their taxable
income. Additional guidance will also be provided on how the Tax on Income for individuals will be
collected.
AFAIK, further sub-decrees and regulations never have been issued.
Same goes for the capital gains tax (Prakas 346 GDT, probably a flat rate of 20%), all we currently know is that it has been postponed to 01/01/2024 (2nd or 3rd time meanwhile) without knowing the exact details.
If you're asking me, initially it'll be limited to the sale of immovable properties in Cambodia, but who knows...
Good advice (when it comes to keeping the Cambodian tax man happy) but following disclaimer:
Never put all your eggs in the same basket, especially not in a basket with a label 'made in Cambodia'...
By the way, you can find better deals in the bond markets taking into consideration equal quality ratings (junk).
There's also no guarantee that your overseas bank will (easily) accept your money back after transferring it to Cambodia first (FATF and so on but that's a complete different discussion).
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Can anyone give a tl;dr summary of whether us normal folks with no businesses or complicated financial situations have to suddenly start doing anything?